Amcor(AMCR -11.87%) reported fiscal fourth quarter 2025 results on August 14, 2025, highlighting the completed Berry Global acquisition, new synergy targets, and a comprehensive portfolio review. Management guided for adjusted EPS of $0.80 to $0.83 in fiscal 2026, representing 12% to 17% year-over-year growth, and expects free cash flow to double to $1.8 billion to $1.9 billion.
The following insights detail integration progress, portfolio reshaping, and operational risks for long-term investors.
Amcor accelerates integration, targets €650 million synergies
Berry Global contributed two months of results in the quarter, boosting net sales and EBITDA. Integration actions included site closures, a headcount reduction of over 200 in the first 100 days, and procurement consolidation, with €260 million in synergies targeted for fiscal 2026 and €650 million by fiscal 2028.
"We completed the acquisition of Berry Global and are now one hundred days into combining two complementary businesses and transforming Amcor's ability to create value for our customers and shareholders. Our efforts are reflected in our expectation to deliver strong adjusted EPS growth of 12% to 17% in fiscal 2026 with free cash flow expected to double to €1.8 to €1.9 billion."
-- Peter Konieczny, Chief Executive Officer
Rapid integration and clear synergy milestones are expected to drive Amcor’s future earnings growth and enhance long-term shareholder value.
Amcor reviews $2.5 billion in non-core sales
Following the acquisition, management identified approximately $2.5 billion in annual sales, including the $1.5 billion North American Beverage business, as non-core due to subscale positioning, cyclicality, or unattractive market dynamics. Ten additional businesses are under review for potential divestment, partnership, or restructuring, with progress on smaller assets expected in fiscal 2026.
"Turning to slide 10. As part of the portfolio review, we have also identified several businesses with combined annual sales of approximately $2.5 billion that are less aligned with our go-forward core portfolio for one or more reasons. They may have a different growth or margin profile, the business operates in an industry with relatively low barriers to entry, or where Amcor may not see a clear pathway to becoming a leading supplier at scale. For these businesses, we will explore alternatives to maximize value, which may include restructuring, partnership or JV ownership models, cash sales, or a combination thereof."
-- Peter Konieczny, Chief Executive Officer
This portfolio streamlining could improve Amcor's organic growth and margin profile by reallocating resources to higher-barrier, innovation-driven segments, while divestment proceeds may accelerate deleveraging.
North American Beverage underperformance poses near-term risk
The North American Beverage segment underperformed, with higher labor and freight costs linked to supply realignment, resulting in a $20 million year-over-year EBIT decline. Management expects elevated costs to persist into the next quarter and is stabilizing the business under new leadership ahead of evaluating strategic alternatives.
"If I'd summarize very simply what actually has happened, The business was very focused, rightly so, on taking cost out, particularly in the first half of the year in order to support earnings in an environment of of lower volumes. And then as they then were approaching what we were approaching the fourth quarter, which in that business seasonally is the highest volume quarter, we ran into service issues for our customers. And that had to do with the out of region supplies, drove higher waste levels, drove higher labor cost in in in the business. And that is and that is what happened."
-- Peter Konieczny, Chief Executive Officer
Persistent operational headwinds may limit near-term EPS upside and complicate efforts to maximize value on eventual divestiture, increasing pressure for swift remediation and successful management integration.
Looking Ahead
Management expects flat volumes in fiscal 2026, with adjusted EPS of $0.80 to $0.83, representing 12% to 17% year-over-year growth, and free cash flow of $1.8 billion to $1.9 billion, assuming €260 million in synergy realization. Capital expenditures are forecast at $850 million to $900 million, and leverage is expected to decline to 3.1 times to 3.2 times net debt/EBITDA, excluding potential asset sales. No formal timeline for major divestitures was provided, but progress is expected on smaller assets during fiscal 2026.
